Important insurance options in case of death, disability or illness

If an accident or illness, a disability or even death claimed one of the unique and irreplaceable people in your life, what would you do?

Mom, dad, grandma, grandpa are some of the affectionate ways we describe family members who are unique and irreplaceable.

If an accident or illness, a disability or even death claimed one of the unique and irreplaceable people in your life, what would you do?

Certainly there would be unavoidable consequences to your personal and family life, but there are some financial consequences that you could alleviate with the right insurance coverage.

Life insurance could provide tax-free funds at a critical time to pay your mortgage or other household debts or as a source of investment income to replace the income from a family member or an irreplaceable other.

• Term life insurance can be a good starter option for younger couples, but gets more expensive over time and does not allow you to renew after age 75 or 80.

• Permanent life insurance stays in force for a lifetime and the premiums are set at the time of purchase and, depending on the policy acquired, may never change.

If the family member is a business-owner, life insurance could be used to repay business debt or a co-owner could obtain key person insurance on the family member and use it to buy out their interest in the business.

Mortgage insurance will cover your mortgage debt. You can get mortgage insurance from your lender but the more flexible option is renewable term insurance that allows your named beneficiaries to use the proceeds to pay off some or all of the mortgage or other pressing expenses.

Disability insurance can provide a source of income should a key family member become unable to earn a living or manage your household for an extended period.

Critical illness insurance provides a lump-sum of money that can be used to pay for the replacement of valuable services and/or the costs of medical care.

Long-term care insurance pays the costs of medical and home care including respite care that allows a caregiver to take a break. It protects your family’s existing financial assets and helps ensure a surviving spouse or children will receive an undepleted estate.

Today’s families and extended families come in many shapes and sizes and each member plays many important roles with a high emotional and life value that can and should be protected by insurance. Your professional adviser can help you make the right insurance choices for your family.

J. Kevin Dobbelsteyn is a certified financial planner with Investors Group Financial Services Inc. His column appears every Wednesday.

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